Helping Military Personnel with First-time Homebuyer Tax Credit

The Senate is working to extend and possibly expand the first-time homebuyer tax credit, and I’ve cosponsored legislation to tailor it to the particular needs of U.S. service men and women.

Members of the military are serving abroad for long periods of time and signing up for multiple tours of duty.  They should have the same opportunity to benefit from a federal tax incentive to buy a house as Americans who aren’t based overseas.  The current structure of the law penalizes members of the military, and that needs to be corrected.

The Service Members Home Ownership Act (S.1728) is expected to be incorporated into legislation to extend and possibly expand the homebuyer tax credit before it expires.  The legislation would allow members of the military to benefit from the first-time homebuyer tax credit, which was first created in 2008 and significantly expanded in 2009.  The tax credit of up to $8,000 is available to qualified home buyers toward the purchase of a first home, provided the purchase is made by November 30, 2009. 

For members of the armed, intelligence, and foreign services whose overseas deployments could have prevented them from taking full advantage of the tax credit, the Service Members Home Ownership Act would extend the deadline for one additional year, through November 30, 2010, for individuals serving on official extended duty service outside the United States for at least 90 days in 2009.  Additionally, the bill would ensure that service members do not have to repay the first-time homebuyer tax credit if they are deployed overseas or assigned to a new military station.  The bill also would exclude from gross income payments to military personnel to compensate for certain declines in housing values due to a base closure or realignment.

According to the Department of Defense, 1.4 million active duty members of the military are deployed around the world.

Congress is considering extending the $8,000 tax credit for first-time homebuyers with one that expands access to more purchasers.  Military personnel are hard-working wage earners, and like their fellow Americans, should have the chance to help themselves and help the economy with a home purchase.